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The books that shaped AmericaAetna and Inova unveil joint venture for improved, cost-effective health care\health yahoo\icon-minus.png)
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Text SizePrintE-mailReprints By Sarah Kliff, The Washington PostInova Health System, the dominant hospital chain in Northern Virginia, is partnering with health insurance carrier Aetna to launch a new plan that would be one of the first of its kind in the nation, with unusual features aimed at reducing costs while improving care.
The rare joint venture of a hospital and insurance company suggests that industries aren’t waiting on the Supreme Court’s pending decision on the health-care law — which could come as soon as Monday — to pursue new collaborations and big changes to their business models.
Loading...CommentsWeigh InCorrections?Health insurance plans and hospitals traditionally operate with competing financial incentives. Hospitals, paid by procedure, have an economic reason to provide the most care. Insurers looking to keep premiums down, however, see incentives to put downward pressures on claims paid out.
Inova’s collaboration, called Innovation Health Plans, aims to break that model by making the hospital and the health insurer co-owners of a health plan and sharing its profits — or losses — evenly.
The collaboration also speaks to a wave of consolidation currently sweeping through the health-care industry. Under the financial pressures of employers’ growing health-care bills, doctors, hospitals and insurance carriers have looked to become more efficient — and have grown more integrated in the process.
“It really picked up last year,” Chas Roades, chief research officer at consulting firm the Advisory Board Co. “If you’re trying to do things like coordinate care more effectively and reduce unnecessary admissions, it’s helpful for you to have control over beneficiary dollars. Then you can change the incentives for beneficiaries, doctors and other facilities.”
That’s exactly what Inova and Aetna hope to do: Provide financial incentives to encourage doctors to use less costly care — such as prevention — without sacrificing quality.
“We really think that creating a network of partners, all of whom agree to treat their patients with the best-known practice, that can materially improve the outcomes and reduce the costs,” Inova Health System chief executive Knox Singleton said. “We think this selective focus can get us the best care around.”
Under this new partnership, Inova and Aetna will use the existing hospital system alongside a group of affiliated doctors as the network of providers that subscribers can see. Using electronic medical records, they will be able to track how well each doctor does at hitting quality metrics — and also provide more personalized medicine.
Similar limited networks became popular in the 1990s with the rise of health maintenance organizations, but they ultimately saw a backlash from consumers who saw their choice of providers shrink. Singleton contends that if Innovation Health Plans can provide more personalized medicine from a small network of doctors with expansive information about each patient, it can be more successful.
“We want to be like Amazon,” he said. “They look collectively at my habits and tell me which books I’m going to buy. We want to build a delivery system that can look at your medical record and understand what risks you have.”
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